CHLSY - Lindt & Sprüngli AG: Upside With An Significant Hurdle

2025-05-13 08:11:20 ET

Summary

• Lindt & Sprüngli is a fundamentally strong company with a major investment hurdle: high share prices and liquidity issues, especially for ADRs.
• The company boasts impressive financials, including a 65%+ gross margin, 12%+ net margin, and low leverage with less than 0.6x net debt/EBITDA.
• Despite challenges, Lindt's premium brand allows for pricing resilience amidst rising cocoa prices and supply-demand imbalances. However, the pricing at this point is high at best.

Dear readers/followers,

In this article, I'll be covering a fundamentally excellent company but with a major fundamental hurdle for investment, one I might currently not be able to overcome. It's not something I usually encounter, but I thought that the fundamental quality of the company was actually better than the hurdle itself, so I feel comfortable covering it....

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